A conglomerate is a cluster of unrelated businesses that are under common ownership. Each subsidiary of a conglomerate is likely to conduct business independently of its fellow subsidiaries, since there is so little linking them. The financial results of the subsidiaries are consolidated into a single set of financial statements for the entire entity.

A reason given for having a conglomerate is that the owners can mitigate their business risk by investing in activities across a broad spectrum of markets. By doing so, a decline in one market will only hurt a few subsidiaries, which can be counterbalanced by more robust results from subsidiaries located in other markets. However, conglomerates can be difficult to manage, since no one can have a comprehensive knowledge of the markets in which every subsidiary operates. Consequently, conglomerates tend to produce financial results that are somewhat worse than would be realized if their component subsidiaries were to be operated as independent companies.